Property for sale: Great views, large lots, no Blacks.

Eagle Mountain is a burgeoning Utah County community, full of young families, new homeowners and white people. Lots and lots of white people.

The racial breakdown of Eagle Mountain was listed as a selling point on the Web site of home builder Bigg Homes. The site also included this comparison among others: “Black race population percentage significantly below state average.” “Significantly below” was in bold.

The ad — which seems to be a likely violation of the Fair Housing Act — has been pulled. The developer is apparently “considering” firing its web designer, who put the information on the site.

The information is apparently accurate and drawn from state demographic data — Eagle Mountain has a black populace of 0.6 percent, significantly lower than the state average.

Economists have argued — Gary Becker, for example — that workplace discrimination is inherently inefficient and will eventually be driven out of the market. (There is a great back-and-forth between Posner and Donohue on the topic, from several years back). However, the Eagle Mountain case highlights a fact that no one seems to talk about much (except for Richard Epstein) — that there is in fact a market for discrimination. That’s one of the descriptive ideas in Epstein’s book Forbidden Grounds, and it’s absolutely right.

I disagree with Epstein’s subsequent normative argument — that since there is a market for discrimination, it should be allowed to exist — but he’s absolutely right to note that there is indeed a market for discrimination. People will sometimes pay for discrimination. They’ll do it in their housing — see Eagle Mountain — and they’ll do it in their employ. This is one reason why the optimistic Becker model — market forces will end discrimination — is incomplete.

As for the Eagle Mountain example, I’m curious as to how much this particular developer’s site reflects community norms in Eagle Mountain. I know one person from Eagle Mountain, and I’m going to drop him a line and see what he thinks of this. (I should note that he’s a very nice person, and is not, that I can tell, at all racist.)

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6 Responses

The market isn’t limited the openly racist people, and they won’t just pay a little, they’ll pay big. Overlay the racial demographic maps of any metropolitan area with the property value maps and you’ll find that, the greater the distance from minorities, the more expensive the property.

Kaimi Wenger at Concurring Opinions has an interesting post up on a Utah developer that advertised Black race population percentage significantly below state average as a selling point for one of its residential communities. Kaimi goes on to discuss the

Comparing this to the discriminatory practices of 1955 is specious and unfair. Did you not read the news story and their links? The demographic information was copied from city-data.com, a site that gathers publicly-available information about cities. Their Eagle Mountain page is here: http://www.city-data.com/city/Eagle-Mountain-Utah.html.

The bolded note about racial composition is from a section comparing the community to statewide averages across several dimensions used by demographers.

Especially because the developer had already asked the web designer they’d hired to remove reference to race, assigning a base motive to him, unless you have more information than you’ve made available here, is wrong.